CA Foundation Exam > CA Foundation Questions > Mohan purchased goods for Rs. 15,00,000 and s...
Start Learning for Free
Mohan purchased goods for Rs. 15,00,000 and sold 4/5th of the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?
- a)Entity.
- b)Periodicity.
- c)Matching.
- d)Conservatism.
Correct answer is 'C'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amo...
The accounting concept followed by Mohan is Matching.
Explanation:
Matching concept is an accounting principle that requires businesses to match expenses incurred in a given accounting period with the revenue earned in the same period. This principle ensures that the financial statements reflect the actual profit or loss earned during the period.
In this case, Mohan purchased goods for Rs. 15,00,000 and sold 4/5th of the goods amounting Rs. 18,00,000. He also incurred expenses amounting Rs. 2,50,000 during the year. To calculate the net profit, Mohan subtracted the expenses from the revenue earned.
However, according to the matching concept, Mohan should have deducted the cost of goods sold (COGS) from the revenue earned to arrive at the gross profit. Then, he should have deducted the expenses incurred during the period from the gross profit to calculate the net profit.
Therefore, by deducting only the expenses incurred during the period from the revenue earned, Mohan violated the matching concept of accounting.
Explanation:
Matching concept is an accounting principle that requires businesses to match expenses incurred in a given accounting period with the revenue earned in the same period. This principle ensures that the financial statements reflect the actual profit or loss earned during the period.
In this case, Mohan purchased goods for Rs. 15,00,000 and sold 4/5th of the goods amounting Rs. 18,00,000. He also incurred expenses amounting Rs. 2,50,000 during the year. To calculate the net profit, Mohan subtracted the expenses from the revenue earned.
However, according to the matching concept, Mohan should have deducted the cost of goods sold (COGS) from the revenue earned to arrive at the gross profit. Then, he should have deducted the expenses incurred during the period from the gross profit to calculate the net profit.
Therefore, by deducting only the expenses incurred during the period from the revenue earned, Mohan violated the matching concept of accounting.
Free Test
FREE
| Start Free Test |
Community Answer
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amo...
Matching concept = Revenue - expense = profit example:- =>1800000+300000-1500000+250000 =>2100000- 1750000 => 350000
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer?
Question Description
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer?.
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer?.
Solutions for Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer?, a detailed solution for Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? has been provided alongside types of Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is 'C'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup